Catalytic Capital Consortium
MacArthur today launched the Catalytic Capital Consortium, dedicating $150 million to help address financing gaps in impact investing, particularly for funds and intermediaries that are not a fit for conventional investment. MacArthur is joined in this effort by leading impact investors The Rockefeller Foundation and Omidyar Network, who will add their expertise and financial resources to the Catalytic Capital Consortium. MacArthur’s first investment is $30 million to expand and accelerate The Rockefeller Foundation’s Zero Gap innovative finance portfolio, matched by $30 million from The Rockefeller Foundation.
Catalytic capital is investment capital that is patient, risk-tolerant, concessionary, and flexible in ways that differ from conventional investment. “Catalytic capital is needed for impact investing to realize its full potential,” said MacArthur President Julia Stasch. “While impact investing is growing rapidly, much of the attention focuses on market-rate returns, leaving a serious gap in financing opportunities for many promising impact enterprises and funds that could help address critical social challenges. The Catalytic Capital Consortium will help more investors appreciate the importance of this type of capital in yielding deeper, more sustainable impact for people and the planet.”
The balance of MacArthur’s $150-million catalytic capital allocation will provide matching investments to a select cohort of funds and other intermediaries that demonstrate a powerful use of catalytic capital with the potential for significant impact addressing the SDGs. To date, MacArthur has invited proposals from impact investment efforts across emerging and developed markets to apply for its matching capital commitments. These funds and other intermediaries address a wide range of issues aligned with the SDGs, such as forest conservation, sustainable agriculture, inclusive entrepreneurship, education, reproductive health, energy access, and refugee finance. MacArthur will announce additional specific investments later this year.
Additionally, MacArthur, The Rockefeller Foundation, and Omidyar Network will dedicate $10 million over three years to grants that fuel learning and market development, helping illuminate when and how catalytic capital can be most effective and what additional tools and practices are needed for impact investors.